POSP (point of sales person)

What is a POSP?

A POSP, or point of sales person, is an individual allowed to sell a limited set of simple insurance products after a short training and test, without going through the full agency examination. The POSP works under an insurer or an insurance intermediary such as a broker or corporate agent, which trains, certifies and supervises them. The idea is that a product with fixed, easy to explain benefits and little or no underwriting can be sold safely by a lightly trained person close to the customer.

POSPs became one of the fastest growing seller types in India, mainly through motor and health insurance sold by digital brokers. IRDAI's annual report for 2024-25 put the number of POSPs at about 27.18 lakh, as summarised by Outlook Money.

How the POSP framework works

IRDAI introduced POSPs through guidelines issued from 2015 onwards: one set for general and health insurers, and one for life insurance, consolidated in a 2019 master circular on point of sales products and persons.

Eligibility and training (life insurance master circular, 2019):

• Minimum age 18 and at least a Class 10 pass, with PAN or Aadhaar as identity proof.
• At least 15 hours of in-house training by the insurer or intermediary, followed by an examination it conducts.
• An appointment letter with a POS code within 15 days of passing. The POS code must appear on the proposal and the policy.

Products. In life insurance a POSP may sell only individual, non-linked products in approved POS categories: pure term (with or without return of premium), non-linked non-par endowment within set limits (death cover up to ₹10 lakh), immediate annuity, and fixed-benefit health plans. In general and health insurance, POSPs sell pre-underwritten retail products such as motor, personal accident, travel and simple health and home covers, within sum insured limits set in the guidelines.

One sponsor at a time. A POSP can be attached to only one insurer or one intermediary at a time. A POSP engaged by a broker can sell the POS products of all insurers that broker works with.

Payment. A POSP engaged directly by an insurer is paid commission by the insurer. A POSP engaged by an intermediary is paid by that intermediary out of its own earnings; the insurer does not pay that POSP separately.

2026 tagging rule. Under the IRDAI (Insurance Intermediaries) (Amendment) Regulations, 2026, from 1 January 2027 each policy sold through an intermediary must carry the name and functional identity of the POSP or other person who sold it.

What IRDAI has proposed for POSPs

IRDAI's September 2026 consultation paper keeps POSPs as one of four proposed categories of Insurance Distribution Persons, engaged by distribution entities. As summarised by Khaitan and Co, a POSP would still be limited to one entity, payouts to POSPs would have to come from the engaging entity's own commission, and the structure would move from layered distribution towards a single level. POSPs set up as firms would need their own entity licence. The paper's proposed motor and health commission caps are well below current market rates, and the law firm's analysis named POSP-led retail broking among the models most affected. These are proposals open for comment until 25 October 2026.

What POSPs mean for distribution

• Fast to recruit, hard to keep productive. A 15-hour course lets a broker sign up thousands of POSPs quickly, from backgrounds such as car dealerships, garages, small shops and other financial product sales. Many produce little after the first few months. Distribution teams that report active POSPs (selling at least one policy a month) instead of registered POSPs get a truer picture.
• The product limit is a feature. Because POSPs sell simple covers, they work well for motor renewals, two-wheeler policies, top-up health and small term covers in smaller towns. Pushing complex savings plans through POSP routes is outside the framework.
• Earnings depend on renewal capture. In motor and health, the POSP's income in year two depends on keeping the customer at renewal. Tools that remind the POSP of renewals due, and quote quickly, matter more than larger first-sale payouts.
• Supervision is the sponsor's job. The engaging entity is answerable for POSP conduct. Tagging each policy to the POSP from 2027, and the proposed public records of mis-selling, mean sponsors need a quality score for each POSP, not just a sales leaderboard.
• POSP can be a first step into insurance. For people who want to test the work part time, POSP is a low-cost entry before full agency. A clear path from POSP to agent or to a sales role is a practical recruitment tool.

POSP vs insurance agent